Case Studies Phase 1


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Case Studies Phase 1

  1. 1. Shared services –Case studies 2011
  2. 2. Contents:03 Creating a Sustainable Learning Community for Buckinghamshire Led by Aylesbury College09 Services in Sussex Colleges (SiSC) Led by Central Sussex College15 Synergy Project Led by Easton College21 Sharing Student Services in the South Led by Nescot College27 Solent Colleges Innovation Partnership (SCIP) Led by Portsmouth College33 Stockport Work Based Learning Led by Stockport College39 North East Shared Services Project (NESSP) Led by City of Sunderland College45 Joining up Services for Cheshire and Warrington Colleges Led by West Cheshire College
  3. 3. Creating a SustainableLearning Communityfor BuckinghamshireThe PartnersThe project is seeking to build on a substantialhistory of collaboration between the two institutions.Stretching back approximately 10 years thispartnership has evolved as both organisations haveincreasingly placed collaborative working at the heartof their approaches. Over a 12 month period the projecthas sought to explore the options for the developmentof an innovative partnership between both institutions.
  4. 4. Areas of Focus ...have a shared The project has focused on developing a federation to: educational ethos and • Develop progression routes through a skills escalator for Buckinghamshire; are looking to drive • Take forward Construction and IT curriculum to pilot institutions in similar the joint marketing and delivery of Further and Higher Education. Apprenticeships and the development of a directions... University Technical College are central to this activity. The use of Technology blended within the learning process and the exploration of different flexible ways of delivering learning also form an important component of this activity. Associated back office functions are also being explored for sharing potential as part of this process. Rationale The project is a product of the evolving relationship between the institutions with both partners “working closely on identifying where the opportunities for greater collaboration are and what is the best way of enabling them to happen”. Central to these discussions has been ability of the partnership to grow to meet the ongoing needs of students’, employers and the communities they serve. Within this context partners identified a number of actual and anticipated external drivers that have influenced the direction of travel, including: • The need for flexible and responsive models of provision to respond to changing study patterns and differing models for financing provision in the future; • Increasing fee income through workplace learning and the roll out of higher level apprenticeships. prime driver is not to save money but how can we improve the student offer4 | Shared services – Case studies 2011
  5. 5. The vision is for ‘cradle Objectives to grave’ learning in an In submitting their bid to the FE Efficiency Innovation Fund partners inclusive community outline the following objectives for the project: with a desire to • Explore the potential for developing provide a wide range new models of delivery for Further of facilities for people and Higher Education; to learn, develop, • Break down the traditional barriers between FE and HE; share, create, socialise, • Encourage progression into HE, both innovate, nurture and for young people already in full time much more education, and for older learners including those already in employment; • Look at how far a joined up approach to marketing and delivery of FE and HEVision can raise aspirations and encourage andBoth partners aim to create a joint enable employers to develop the skillssustainable learning campus for of their workforce up to and (whereBuckinghamshire, developing a skills appropriate) beyond level 3;escalator concept for the seamless • Utilise technology to find new solutionsdelivery of curriculum from levels for easy ways to learn at times to suitof one to eight in a range of technical, the individual.practical and academic subjects Shared services – Case studies 2011 | 5
  6. 6. Activities Shared Services Model Participation has been at the heart of Federation the project development process with collaborative exploration and planning Savings sessions held at key stages throughout. Partners have also explored developing This project is focused on growth and best practice through shared delivery increasing revenue streams for both and have explored a number of potential organisations. Both institutions’ remain models for sharing services. Having the in discussions regarding the future of capacity and finding the time and space shared services with a recent successful to explore and develop the project has bid for the establishment of a University been central to the process. Partners Technical College (UTC) a central part of particularly value the role played here their plans. Initial projections suggest that by the FE Efficiency Innovation Fund if successful, the net increase in annual which “enabled them to take the time and revenue will be £70,000 in 2014/15 rising space they needed to understand what to £1.16 million in 2019/20. shared services could be”. To date the collaboration has already resulted in some efficiency savings through the joint employment of New Buckinghamshire University’s Human Resources Director being seconded to the Aylesbury College for 1 day a week and £25,000 saved by joint marketing activity in 2009/10. With increased collaboration, savings such as these are likely to increase. vital by enabling us to take a step back from our day to day pressures6 | Shared services – Case studies 2011
  7. 7. many of the challenges Enablers lie ahead as we move Key factors in the project’s development have been: from visioning and • FE Efficiency Innovation Grant Fund strategic level activity – this has provided the additional resources and capacity to enable towards practicalities staff to have the time and space to and implementation really explore and understand shared services and what they should look like and achieve for the partnership; • Effective, timely and inclusiveOutcomes and the Future communication – a participativePartners are committed to the approach to developing the projectdevelopment of the Federation through joint facilitated workshops,and are currently in the process open discussion and debate;of developing and finalising theirbusiness plan for shared services • Strategic Commitment – leaderswith the successful UTC bid playing in both institutions are committedan important role in this. Partners to growing their organisations indiscovered the positive outcome collaboration and have driven theof this bid on 10 October 2011 project in a “coherent and structured way”;with implementation on joint • Consensus and Trust – as a resultcurriculum and student pathways of the long term relationship betweento commence immediately. partners there is a strong culture of trust and a consensus in terms of the direction of travel for the institutions both individually and collectively. unless you get very clear and complete agreement from the top on day 1 you haven’t got much chance...we had that Shared services – Case studies 2011 | 7
  8. 8. Critical Factors Factor Barrier Solution Importance Culture & Organisational As partners move towards the practicalities of shared Medium/ Climate Cultures services, bringing together the different cultures of an HE High and an FE organisation is seen as a potential challenge. Open communication is seen as the way in which this can be addressed. Process Time Developing shared services requires considerable time Low/ commitments commitments. The FE Efficiency and Innovation Fund support Medium was identified as integral to supporting and maintaining partner involvement in this process. Staff technical Some staff had to improve their competence to embrace Medium capabilities technological solutions through dedicated training. Externalities Systems Partners anticipate this being a potential barrier as they move Medium compatibility towards implementation. Summary This project highlights the importance of investing time in building relationships and establishing trust between institutions with differing cultures. The project has evolved as part of a long term process of collaboration by the two organisations involved. While this process began long before the funding has acted Innovation Fund, partners suggest that the additional capacity provided as a catalyst that has accelerated this process and added has enabled us to considerable value to their approach. explore and take Based on a strategy of growth this project is part of a wider collaborative agenda forward a number of which incorporates the development of a University Technical College for medium and longer Buckinghamshire. term ambitions for Watch, on the AoC website collaboration Aylesbury College and Buckinghamshire New University’s journey on working together and the benefits the projects has brought to apprentices.8 | Shared services – Case studies 2011
  9. 9. Services in SussexColleges (SiSC)The PartnersThe project is seeking to build on a substantial historyof collaboration between all of the Sussex basedcolleges through FE Sussex. For the purposes of thisproject two Surrey colleges have joined the consortia.FE Sussex is a membership based organisation,owned by Sussex colleges. It has a history offacilitating collaborative working across Sussexcolleges in a diverse range of activities includingthe development of shared procurement processesstrategy and the sharing of senior and specialistHuman Resources and Health & Safety roles.
  10. 10. Areas of Focus this project will The project is focused on the following areas: position [the colleges] • Finance, including reporting, sales invoicing and accounts receivable, purchasing and payments and to select the best cash and banking; and shared services option • Human Resources (HR), including staff information, recruitment, training and development and payroll with partner colleges and benefits. whatever the financial Management Information Systems (MIS) were also considered as part of this project but it was decided that and organisational partners would not move forward with collaboration in demands of the future this area at present. may be Rationale The project should be seen as a product of the evolving relationship between the majority of the institutions involved in the partnership. Within the current funding and economic environment FE Sussex partners were keen to explore further collaborative opportunities to improve the efficiency of back office operations. The ‘Case for Action’ outlines the project rationale as: “responding to significant reductions in future government funding, we are taking proactive steps to explore the potential to improve service delivery through the adoption of best practices and reduce costs by carrying out back office transactional processing on a shared service basis.” Front line staff have developed their understanding of their ‘back office’ systems and processes independently which has led to great variation across the sector, albeit within a range10 | Shared services – Case studies 2011
  11. 11. we aim to produce a Activities payback on investment The project has been designed as a two phase process. To date phase one that justifies a has been completed with activities undertaken including: continued commitment • Collaborative development of a ‘Case to the project and we for Action’; aim to produce overall • An exploration of existing shared service annual efficiency practice beyond FE; savings • Strand 1: Systems – defining the most appropriate IT systems for each service area, scoping process and resources required for each college to change toVision a common platform;The project’s ‘Case for Action’ outlines • Strand 2: Business models – considerationthe anticipated benefits to be to produce and evaluation of potential businessa pay back on investment that justifies a models to ensure that the model chosencontinued commitment to the project and fulfils the governance and servicean overall annual efficiency saving. delivery requirements of each partner. This process also incorporated anObjectives exploration of implementation barriers;Key project objectives can be summarised as: • Development of an Outline Business Case. Exploring the potential to improve service delivery through adoption of best practices and reduce costs by carrying out transactional processing on a shared platform and service basis Shared services – Case studies 2011 | 11
  12. 12. Shared Services Model a great deal of ground The current proposed delivery model is that of a not for profit company work needs to be limited by guarantee. carried out at an early Savings stage in order to set The outline business case outlines the up shared back-office following potential cost savings over three systems years based on an eight College model: Service Area Gross Investment Net savings Required Savings Outcomes and the Future Transactional £986,655 £690,000 £296,655 Partners are committed to the Finance development of the project and are currently in the process of developing Transactional £577,488 £336,000 £241,488 HR & Payroll and finalising their business plan and detailed business case for shared services. At present they are looking It should be noted that the distribution to proceed with a phased approach of of total net savings differs significantly implementation, which will involve: between partners with the lowest return • Aligning IT systems; for transactional finance estimated at £9,505 over three years and the lowest • Aligning processes; for transactional HR & Payroll only • Potential development of a shared £4,627 over three years. services centre. everyone is at different stages and converging from different starting points and this causes difficulties for shared services as we all need to get to the same starting point before launching collaborative approaches12 | Shared services – Case studies 2011
  13. 13. Enablers funding was a great Key factors in the project’s development have been: opportunity to develop• Additionality of FE Efficiency shared services, Innovation Fund - it has provided address key challenges additional resources and capacity to enable partners to build on their and reduce costs existing collaborative activity and take this forward to drive efficiencies in key back office functions; unless you get very• History of collaboration – as a clear and complete result of the long term relationship between partners there is a strong agreement from the top culture of trust and a degree of consensus in terms of the direction on day one you haven’t of travel for the institutions involved; got much chance...• Existing collaborative infrastructure we had that – the established structure of FE Sussex provided an existing collaborative organisation with a track record of collectively working with and on behalf of partner colleges. Shared services – Case studies 2011 | 13
  14. 14. Critical Factors Factor Barrier Solution Importance Culture & Organisational Establish pilot and working groups well in advance to enable Medium/ Climate Cultures cultural embedding of cooperation. High Process Timescales Developing shared services is complex and requires High considerable time commitments. Incorporating college decision making processes within planned timescales is challenging and needs to be considered at the outset. Funding timescales may require compromises to be made. Communication A communication strategy is essential to ensure all leaders Medium/ and governing bodies are fully aware of direction of High travel and that communication is effective both across the partnership and within the partner organisations themselves. Externalities ICT Costs ICT systems require significant upfront investment by Medium/ partners. High Summary This project highlights the importance of lead times in building relationships and trust. The presence of an existing collaborative infrastructure is an important driver in the strength of while developing this project which should be seen as shared services may having evolved as part of this long term process of collaboration. While seem straight forward this process and an awareness or desire at a superficial level to explore shared services was present before the Innovation Fund intervention, it is actually very partners suggest that the additional complex capacity provided has accelerated this process and added considerable value to their approach.14 | Shared services – Case studies 2011
  15. 15. Synergy ProjectThe Partners
  16. 16. Areas of Focus Our work with the The project had four initial areas of focus: Synergy project has • Finance; • Management Information Systems; built a very strong • Information Technology; partnership between • Human Resources. the two colleges To these were added secondary workstreams of Work Based Learning and Marketing & Quality. Rationale Three years ago, Otley College, in Suffolk, commissioned external consultants to undertake a review of the College and look for potential partners as part of a growth strategy. The College has a land-based specialism. It was looking to get “match fit”, with a labour market focus on rural employment, and to “grow our sector”. Through this process, Easton College, another land-based college based in Norfolk, was identified as a potential partner. Both Colleges are a similar size, and are the last specialist colleges of this kind in the locality, with others now amalgamated with other FE providers. Although the campuses are 44 miles apart, both Colleges have a history of being very competitive with each other. The rationale for collaboration is primarily sectoral, as both colleges target rural areas.16 | Shared services – Case studies 2011
  17. 17. Vision Objectives The project aimed to: The project sought to achieve three deliverables:• Strengthen landbased provision to meet the needs of learners and industry; • Shared Management Information providing timely information on• Increase efficiency generating significant learners, human and physical resources savings for reinvestment; and streaming benchmark information• Promote best practice at both colleges between the colleges. It was also intended though undertaking a full review of their that this could provide a platform for systems, processes and procedures; and other colleges to join;• Expand the range of teaching materials • A unified web based Sharepoint interface available in each college through sharing. for information gathering, sharing and improvement; and • The creation of an e-library of process and system documentation that spans the two colleges building best practice. These processes are intended to be developed to provide core unified systems for key shared service areas, and again have the potential to become a platform for other colleges. Shared services – Case studies 2011 | 17
  18. 18. Initial Joint Project Working Implementa- Workstream Merger post/project Development Groups tion Planning Development proposal manager Activities Savings The initial process was driven by the The initial gross payroll and oncost creation of a shared post, which was savings for the first 12 months are filled by a member of Easton’s senior c.£250,000. This is expected to increase management. Implementation of annually as the project progresses. specific activities was driven by joint There are, however, additional one working groups of practitioners within off capital set up costs of c.£340,000 the colleges who have driven thematic to be incurred to full implementation, aspects of the project. including upgrading and future The development of these close working proofing software and IT infrastructure. relationships, and a communications strategy with college staff, has helped The Synergy project to enable project implementation. This has been further developed by bringing funding has enabled the governors together in joint meetings to be informed of progress and provide us to develop detailed strategic direction. shared services leading to effective joint Model The model has developed over the project understanding and process from joint service delivery to a savings in the first full merger proposal, while maintaining separate college branding. year18 | Shared services – Case studies 2011
  19. 19. Aligning cultures will Enablers be a long path which Key factors in the project’s development have been: has its own challenges • Joint Posts – The early establishment and rewards of joint posts, drawn from each of the colleges, to drive and lead aspects of the shared services; Outcomes and the Future • Joint team working – across the colleges in each of the functional areas, in order to The Colleges now have five shared acclimatise staff with working with each posts, comprising: other and sharing best practice; and• Vice Principal Finance & Resources • Active strategic leadership – Joint (who is the project lead); Steering group consisting of Governors• Assistant Principal Planning, established at an early stage. Funding and Efficiency; In addition, the project has learned from• Director of Human Resources; good practice elsewhere, for example• Director of Enterprise and with senior leaders from each college Marketing; and visiting Cornwall College, to look at its management and group structure, which• Work Based Learning Contracts Manager. has separately branded colleges within a collective entity. Biggest outcome is trust and vision The sharing structure is that the staff remain employed by an individual college but are seconded to the other college for part of their time. This currently has VAT implications. Work is continuing on the alignment of processes, for example in the adaptation of IT and HR approaches, utilising good practice from each of the two colleges. The Shared Services resources have been used to develop projects to bring the Colleges closer together. They have now agreed to work towards a Type ‘A’ merger proposal. Shared services – Case studies 2011 | 19
  20. 20. Critical Factors Factor Barrier Solution Importance Leadership & Existing Creation of joint posts, mainly drawn from existing staff, and High Governance perception of encouraging practice sharing using best from each college. competition In addition, there has been close working between the senior leadership teams and governors of each college, enabled through regular joint meetings and working groups. Culture & Concerns over Joint working across teams within colleges was at the centre High Climate budget cuts and of the approach, encouraging transparent communication future of jobs and involvement in re-engineering processes, which helped to establish trust across the two colleges and with senior management. All college staff were actively encouraged to visit counterpart and share best practice extending benefits beyond the Synergy Project workstreams. Project focus on growth and excellence rather than staffing cuts. Process Time Staff commitment and future project design/resource High commitments implications were addressed by segmenting issues rather than addressing all at once. Utilising external consultant’s expertise (although there is recognition of ownership issues around this). The colleges will also backfill staff to help with the day job moving forward. Externalities IT compatibility Significant effort has gone into examination of this aspect High through a joint working group and commissioning external advice on systems development. These one-off costs, including costs of future proofing and enabling other partners to join in the future, have been incorporated into the planning process. VAT The VAT costs have been accepted and are factored into overall Medium implications savings calculations, although they will not have an impact on the colleges after merger. However, VAT is likely to remain an issue for future shared services partners. Summary While this project is an exception in that in the context of understanding the changes it is leading to a proposal for college in the FE market, and strengthening their merger, it highlights the importance specialism as rural providers. of lead times in building relationships and trust. The process of co-operation With hindsight I realise was developing prior to the Innovation Fund intervention, although the partners we needed far more acknowledge that the process would have been much longer without this resources than we had support. Merger is now seen as the available resulting in logical conclusion of this process long hours for the staff While the focus has been on shared resources, the colleges involved have also involved (although they developed from having a perception of have continued to be each other as competitors to now looking at the joint market they are addressing in enthusiastic) rural East Anglia. This decision was taken20 | Shared services – Case studies 2011
  21. 21. Sharing StudentServices in the SouthThe Partners
  22. 22. Areas of Focus In order to realise The project reviewed the feasibility of providing shared services using a customer contact centre model for the the full efficiencies delivery of student services between three colleges in South-East London and Surrey. This aimed to create an and improvements integrated customer pre-entry experience for potential in quality standards, learners at the three partner colleges, focusing on the customer journey from enquiry and the provision of standardised processes information and advice support through to admission and enrolment. It therefore addressed: and systems were • The customer journey; required • Information, Advice and Guidance and enrolment; and • Supporting systems. Rationale The project partners are two neighbouring colleges, in Greenwich and Bexley, and a third college in Surrey, NESCOT, as the project lead. An independent training provider, Mainport Training, was part of the initial bid, but dropped out at an early stage. In addition, there were two “observing” partners, NACRO and the University for the Creative Arts, who did not play a part in the project. Relations between the partners were assisted by the fact that the newly appointed principal of Greenwich has formerly been Vice-Principal of NESCOT. The Principal of Bexley was also relatively new to post. This project focused on whether front-office student related services could be shared and deliver both efficiency savings and service improvements.22 | Shared services – Case studies 2011
  23. 23. Vision Objective Potential learners, their parents, carers The overall objective was to create a and advisors will experience a service shared customer contact centre that that is customer focused, is efficient, was web and mobile-enabled for IAG effective and that provides information and admissions while ensuring students and advice that “gets it right the first experienced a service that was branded time”, whether that is online, through a for each individual college. telephone enquiry or face to face and the facility to enable on-line applications and enrolments. Also self service models of customer service will be developed. MoU/Scoping/ appointing Initial Joint Implementa- Business ReportingPlanning project Working tion Planning Case manager Activities The partners appointed an independent This also required the alignment of project manager, who managed the information systems, with, for example, project using PRINCE2®. The agreement two of the colleges using the same between the partners required Principal back-office management information level participation at all meetings, in system for student records including order to maintain ownership. applications; while the other college uses There were issues of alignment in a separate system. Advice was sought practice: one college made significant on ways in which these could be made and increasing use of online applications to work together, without excessive (44% of students apply online); another investment in new systems. makes very limited use of online In addition, as a result of working processing which currently results in dual together, two of the colleges now have a data entry; while the other does not have shared Executive Finance Director post an online applications module, meaning at senior management level which has that all applicant information is manually resulted in significant cost savings. data processed by admissions staff. The work to date has been focused on the development of the business case to take forward to implementation in Phase 2, once resources have been sourced. Shared services – Case studies 2011 | 23
  24. 24. Model Savings Six delivery models were considered The business case estimates that in the business case: the preferred options could achieve operational savings of 31% over five • Status quo; years and cash savings, after investment • Sharing expertise between the college costs, of 12-14% over a five year period partners; (c.£333,000). • Development of a Virtual Customer This is in addition to the existing savings on Contact Centre; a shared post between two of the partners. • Development of a Centralised Customer Contact Centre; In-house delivery is • Working with an external partner to favoured on financial establish a managed service Customer Contact Centre; and and quality grounds • Outsourcing the function to a specialist supplier. Each option was exposed to SWOT analysis, appraised using financial and non-financial criteria, and exposed to a sensitivity analysis. Options 3 and 4 were preferred. Governors keen to work together with joint development sessions – they don’t feel threatened24 | Shared services – Case studies 2011
  25. 25. The key to success is Enablers trust and having the • Existing relationships and confidence – between partners, which has been built same expectation of through work to develop and refine standards the bid agreeing priorities and sharing resources underpins the project. • External project manager – was appointed, working with the principals, Outcomes and the Future was also seen a key factor in project The business case provides a proposed implementation. implementation plan for the preferred • Using previous experience – the project options with a start date of November also drew on the experience and advice 2012 (i.e. applications for entry in of the Kingston City Group, which was academic year 2013-2014). established in 2005, and involves 14 higher However, there remain issues over the education institutions in London and the availability or resources to achieve this, South East area accessing shared internal and further work may be required to audit services. The models developed by validate the achievability of this timeline. the Group informed the development of The project has also identified the business case although it should be non-financial benefits, comprising: noted that this structure does not provide limited liability.• Collaboration without loss of identity; • Independent legal advice – The project• More effective use of partner assets, also utilised independent legal advice including rapid access to specialist areas over the structures to be adopted, and of expertise. For example, one college the taxation implications. has a reputation for excellent curriculum management and innovation, another for recruiting international students; Independent project• Improved quality of service to students; manager is very• Shared resources, for example in important to keep the recruitment of joint posts;• Sharing best practice; project on track• Peer review;• Learning and development of staff;• New opportunities for staff; and• Opportunities for further collaboration and engagement with other colleges, contributing to sustainability. Shared services – Case studies 2011 | 25
  26. 26. Critical Factors Factor Barrier Solution Importance Leadership & Building trust Ensuring senior level involvement at all project meetings High Governance Consultations with Governors to understand strategic options and the risks involved in shared services. Culture & Managing Ensuring that the relevant workforce is ‘right sized’ or ‘lean’ High/ Climate change before sharing. Medium Process Management Using readily available and inexpensive technologies to Medium time connect partners (e.g. Skype). Learning from others through ‘business tourism’. Externalities Taxation VAT is only charged on the non-pay element of total costs as Medium/ the total pay cost is ‘staff’ by virtue of a joint employment High contracts. Advice from tax advisors to the project has suggested that the staff cost element of charges to the member institutions is free of VAT as there is no deemed supply, with any generated surpluses generated on being exempt from corporation tax. However, any charge over and above the recovery of staff costs is subject to VAT, and if the project provides services to institutions which are not ‘joint employers’, VAT becomes liable. Legal issues Formal organisational vehicles can be problematic for Medium colleges work teams that are operating at historically different levels of efficiency and quality. Unincorporated associations (membership) can work well for some small-scale shared services, although they are problematic where TUPE applies. Summary The project has remained focused on the development of a persuasive In the early stages of business case for the development the project there was a of shared applicant/student facing services. Extensive use was made of long debate about the external advice and of good practice number and type of from elsewhere. The preferred options identified suggest that an in-house partners to be included approach will be more effective. in the project. As a Development of the project will be contingent on identifying the funding result it was agreed to sources to take this approach forward. keep the maximum to 3 The project has also led to the establishment of a joint senior post to ensure the project’s between two of the collaborating colleges. deliverability26 | Shared services – Case studies 2011
  27. 27. Solent CollegesInnovationPartnership (SCIP)The Partners
  28. 28. Areas of Focus The key to the project The project has had a very broad focus, with the outline business case identifying a wide range of potential was the similarity of shared services including; adult provision; management information services; procurement; cloud based services; the partners business continuity; human resources policy; health and safety; professional services; building management, information and communications technology support; shared virtual learning environment; bid writing and bid consortia; and international students. A number of potential shared service vehicles are being considered. Rationale The Hampshire Group of eleven sixth form colleges have worked together for over 11 years. A sub-group of 5 colleges, with a focus on more urban, open access community activities saw a commonality of interest which they wished to pursue. They were later joined by a sixth member. need for flexibility and appetite for change The sixth form colleges are all relatively small, when compared to general FE colleges, and saw a potential benefit in seeking out areas where they could share services. However, there are significant variations in local needs and demand and these are reflected in the service delivery of the colleges. The colleges consider that they must retain a local autonomy in order to service their communities and that this must not be compromised through a wider regional grouping. The colleges are firmly rooted within their local communities and accountability is a key issue. not a quick process - maybe five years rather than one year Discussions have also indicated the potential to split the partnership into two cluster groups for certain activities, one serving the western (Southampton) area and one the eastern (Portsmouth). Clusters are seen as providing the opportunity for geographically localised support and service yet retaining the overall grouping for wider partnership, representation and service.28 | Shared services – Case studies 2011
  29. 29. Vision ActivitiesThe Solent Colleges have gained The project commenced with theexperience of working together over appointment of an independent projectsome time. However, to date, this work manager, who had experience ofhas mainly been at an informal level working in the local sixth form collegewith agreement to work in cooperation environment. It is managed throughwhile retaining full independence and monthly meetings of a steering groupgovernance in all areas. made up of the college principals andThe project seeks to leverage a project manager.transition in the practice and experience An initial meeting brought togetherof partnership, moving from the the senior management teams of alloperational to the strategic level of the colleges, and relevant functionalpartnership. That requires a more leads. This meeting was used to identifyformalised agreement between partners potential areas for collaboration, andBusiness models range from the informal came up with a very wide range ofcooperative (the current model) through areas impacting both on front and backa series of stages to full integration with office activities. For example, 5 of the 6a variety approaches being considered. colleges use the same MIS, which provide potential for collaboration, and the AoCObjective Procurement Team have been involved in supporting the project in accessingThe project seeks to take forward external benchmarking existing informal collaborativepartnership into a more formal The colleges are also working togetherarrangement in the form of a membership on small department subject areas,association. Through membership of an such as law, science and maths,association, the partners seek to be able to joining together delivery with a viewcreate a unified partnership to represent to creating virtual departments acrosssmaller colleges in a close geographical the partnership and possibly leadinglocation and, through that partnership towards common heads of department.seeks to achieve increased value for Representatives from the partnership havemoney and quality. also attended a number of training events in areas appropriate to the development of the project. These have included specialist training in procurement and contract management and law and background to and implementation of the shared service agenda. Shared services – Case studies 2011 | 29
  30. 30. The partners see the project as a longer term process, to four years and more, not just about saving comprising: money – funding is • Working together for ‘quick wins’ over invaluable the first year: Identifying commonalities; sharing data and policies; process mapping, securing external advice; establishing shared service groups; Savings and developing lead college status At this early stage, some reductions in within an unincorporated association; the cost of joint legal work have been obtained, and there are projected savings • Coming together over the next two of 2-5% savings in exam fees. years: Creating services as a joint venture; sharing services in the cloud; sharing Joint purchasing of MIS is anticipated management; sharing students; and to save £250,000 over five years. • Exploring federation in year four, with the intention of establishing a group of Best funding meeting colleges provided with common services in my entire career and management by a single company. Model At the moment, the model is a Soft Federation, as there are differences in the rate at which partners may want to progress. This creates opportunities for an overall group of six colleges providing central services which may or may not be taken up by partners and for sub groups or clusters of colleges who may wish to work in particular directions, at differing rates and in response to more local factors. However, ultimately the vision is to create a shared service company.30 | Shared services – Case studies 2011
  31. 31. Outcomes and the Future Enablers There remain issues over the relative Key enablers for the project comprise: ambitions of the partners over the scale • Independent Project Manager – The of implementation across some areas. role and experience of the independent Working groups are taking forward project manager, who already had contact activities in: with the colleges involved. However,• Finance; it was considered essential that project ownership remains with the colleges• MIS (development plan in place); themselves;• HR (development plan in place); • Early engagement – practitioners were• Student Support; involved in an early stage within the working groups to identify ways forward;• Curriculum and Student Experience; and • Trust – The level of trust from• Clerks to Corporation. working together that has enabled full benchmarking of activities across Events may push [the the colleges, including the sharing of financial data; partnership] farther • Governors – Involvement of governors, and faster through regular meetings (2 joint meetings held and third scheduled) ensuring that there is leadership However, the partnership has evolved, commitment; and some of the work will be divided into two groups. (Southampton & • Joint Collaboration – Gradual awareness, Portsmouth) dependant on the project through working together, that there areas. It is also considering new partners, could be a long term joint collaborative and there have been discussions with strategy that would benefit all partners, the HE sector (Portsmouth University) rather than competing with each other. around curriculum offering. Fantastic to know you’re not alone Shared services – Case studies 2011 | 31
  32. 32. Critical Factors Factor Barrier Solution Importance Leadership & Large number The need to understand governance and legal requirements Medium/ Governance of partners has been central to project development. High Governors have been kept involved as a central part of the process. Culture & Desire for Colleges are participating at their own pace within a High Climate independence pre-existing collaborative structure. within college structures Process Wide range The establishment of functional working groups and High of activities sub-regional partnerships. Recognition of need to included in manage quality. proposals Externalities Shift in funding Review of project implications including VAT implications for Medium of Sixth Form schools as opposed to FE colleges. Colleges from SFA Summary As the activities section notes, the Maybe end up with project is seen as a medium to long 2 geographic clusters term development, with a specific geographical and functional focus each with 3 partners for like-minded colleges facing similar local issues. The activities in scope extend across front- and back-office functions, and have major implications for investment, staffing and service delivery. The range of activities being considered means that different types of approaches and partnerships are likely to develop as the project moves on over the next few years, with an initial impact on MIS, HR and procurement.32 | Shared services – Case studies 2011
  33. 33. Stockport WorkBased LearningThe PartnersA number of the partners have some experience ofworking collaboratively. * * Damar are joining the federation in 2012.
  34. 34. Areas of Focus this isn’t a standard The project is focused on work based learning (WBL), including joint bidding for contracts and aligning shared services marketing and stakeholder and employer engagement. project...exploratory it is very confusing for employers, conversations have they get swamped by a complex centred on future range of organisations... we want business, generating to simplify the offer resource streams through collaborative Rationale working, and The project has evolved out of collaboration between some joint areas of partners with the following factors driving it towards its current focus: marketing and bid • The lead institution, Stockport College, have a long management standing set of relationships with the private training providers involved in the partnership, having worked in a number of different setting with these partners. In recent years the College have led a consortium of providers which develops and delivers apprenticeship training for the Local Authority. Through this work they have aware of the strengths of these organisations and the quality of provision delivered. • The launch of the Skills Funding Agency (SFA) Minimum Contract Level (MCL) is another key driver with some partners initially concerned that the minimum threshold may threaten their sustainability. • A desire to simplify the work based learning offer for employers in Stockport. Against this backdrop Stockport College decided that something should be done to strengthen both their partnership with the providers involved in the project and the WBL offer in Stockport.34 | Shared services – Case studies 2011
  35. 35. Vision the overriding priority The creation of a federated structure incorporating providers serving the and focus of the Stockport sub-region with the main federation is to improve purpose of managing the relationship and negotiating a single work-based the learner offer, learning contract for Stockport with the learner experience and Skills Funding Agency, whilst enabling federated organisations to maintain their leaner pathway... and own local focus and individual identity. broaden the provision The Federation will lead improvements in three areas: offered in this area...• Cost reduction (both to providers and targeting of specific to the SFA); sectors with specific• Quality improvement (including partners where this will the rigorous application of agreed performance standards); and strengthen the offer• Apprenticeship development (driving innovation and adopting new Partners are clear that the Federation frameworks to tackle skills gaps and will not replace their core business shortages). activities. Instead it will provide a platform for greater scope and more It is also intended that the organisation strategically-planned collaboration. will become a regional voice for providers In doing so partners aim to achieve on apprenticeship issues. the following objectives for partners, learners and clients: Objectives • Wider reach across the region; It is anticipated that the Federation • Moving into new territory and new agreement will allow partners to bid provision; for and manage larger, more complex projects in a collaborative manner with • Strategically planned offering; an aim to: • Unified approach/role;• Drive growth; • Scale of bidding, vehicle ready to bid• Broaden the provision offered in the area; and provide business;• Increase knowledge and expertise across • New business – cohesively targeted all partner organisations. planning; • Cohesive offer – overlap and trading of provision to avoid duplication; • Future proofing against possible rises in MCL; and • Independence – with enhanced links to other strong like-minded partners. Shared services – Case studies 2011 | 35
  36. 36. Investiga- Imple- Scoping/ Toolkit tive Analysis mentation Transition Reporting Planning Development Fieldwork Planning Activities Savings The project began in November 2010. The Stockport WBL project is focused Key activities and project stages on business growth rather than solely undertaken to the Business Case stage generating efficiency savings through are shown in the diagram above. reduced costs. However, there is an Each of these key stages has involved expectation that joint marketing and a significant amount of collaborative collaborative bidding will reduce costs activity between partners with for partners. Current projections suggest participatory workshops held to that such savings would equate to £17,000 facilitate discussion at key stages. for every £120,000 of activity allocated to Legal representatives are currently the Federation. This represents a saving finalising the business model. of 14% on current allocated expenditure to an income of £120,000. Model the project is about The model being developed for the Federation between partners will be a innovation and Company limited by guarantee controlled income generation, and equally shared by its members. with efficiency acting wanted something as an important but stronger than subsidiary feature of the partnership but project short of merger36 | Shared services – Case studies 2011
  37. 37. [funding] has been a Enablers catalyst that enabled Key factors in the project’s development have been: us to bring in the • Independent Project Manager – Funding necessary support... the an independent external consultant as project manager and ‘honest broker’ and project wouldn’t have as an independent change agent. This has happened in the same facilitated honest open debate and greatly enhanced trust between partners; way without it • Collaborative Approach – Stockport College showing their commitment and intentions with their philosophy and Outcomes and the Future approach emphasising that this was Partners are committed to the about collaboration and not merger; development of joint company limited by • Prioritisation – Leadership participation guarantee, with partners expecting this to from Stockport College showing be registered before the end of 2011. Work partners the importance the College with legal advisors on this is progressing. placed on the project; However, partners suggest they are frustrated with the pace of progress. • Building Relationships & Communication – Stakeholder relations Partners have identified a number of have enhanced through clear lines of positive outcomes through participation candid yet constructive communication in the project, including: between partners;• The benefits of collaboration between • A history of collaboration – between FE Colleges and private sector providers the lead institution and other partners. with considerable potential for knowledge and values transfer between the sectors; needed someone• Improved levels of trust between who could be seen as participating organisations which has served to strengthen the partnership. an honest broker... [external support] bringing together has been really useful public and private in developing trust sector organisations, between partners... has been a major played a very positive feature of the significant role project Shared services – Case studies 2011 | 37
  38. 38. Critical Factors Factor Barrier Solution Importance Leadership & Differing Providing a range of levels of partnership and recognition that High Governance organisational each partner is not required to sign up to all activities as part context and of the federation. objectives Culture & Trust issues Some partners were nervous about the motivations of Medium/ Climate partnership and the potential threat to their autonomy. High Partners have sought to build trust to address this and the use of an external consultant played an important role in this. Staff Participation has largely been restricted to leadership groups Medium/ within partner organisations. This is due to the potential High for wider staff groups to associate the project with recent restructuring. Clear lines of communication will be established once the project is opened up to wider staff involvement. Process Time Smaller partners in particular have capacity issues. Utilising High commitment an external consultant has been one way the group has sought to address this. However, three larger partners have largely driven the project. Externalities Establishing the The process of working with legal advisors to establish the Medium company company has taken longer than anticipated. VAT Partners are currently in consultation with legal advisors to Medium/ implications consider the issue of VAT and its collective and individual High implications. It was assumed at the Summary outset that an honest, A proactive shared services project based on business growth rather than open dialogue between only cost reduction, Stockport WBL partners should lead illustrates the importance of a history of partnership between the lead institution to a shared outcome. and its partners. It also highlights the Whilst this did result, importance of an “independent broker” to build relationships and trust by to some extent, not all facilitating difficult conversations in partners can travel as an approach that encourages open debate and discussion. far or as fast The commitment and leadership of the lead institution was key driver in the development and progress of this project. “it’s about trust, you have to be trusted. It takes time and you need to live it as well as say it”38 | Shared services – Case studies 2011
  39. 39. North EastShared ServicesProject (NESSP)The PartnersOriginally a partnership of seven colleges, three partnershave since left for a variety of reasons ranging from theprivate sector provider that left due to the VAT relatedissues and a College that had to withdraw due to apossible future merger.The four partners do not have a history of working inpartnership together, with the lead institution bringingtogether the partnership specifically for NESSP.
  40. 40. Areas of Focus [partners] have The project has focused on: worked really well • Finance – this includes budgetary management, Capital Budgets, Income Receivable, Supplier Payments, Fixed some Asset Management, VAT Returns, Management Accounts, Payroll, Procurement and System Administration. ways we see each • Management Information Systems – this includes others as direct Curriculum Planning, Enrolment, Timetabling and Registers, Coding and Masterfile Maintenance, ILR competitors... trust and Examinations. has developed... project • Routine Processes – All processes that are routine, rules based or delivered remotely are in scope for has strengthened and future development. reinforced these links Rationale Decreasing resources is a context common to all Colleges. Consequently the need to realise efficiencies through reduced costs is one of the principal drivers of all Shared Services projects. However, partners involved in NESSP were keen to reiterate that this process is also about driving quality improvements in the delivery of back office services. Therefore, the project should not simply be seen as a cost saving exercise. In particular the project is focused on shifting to a more efficient, responsive and personalised approach by addressing some of the following shortcomings in existing systems and processes used by participating colleges: • A shortage of accurate information and priorities; • A need to continually collate information from various sources and relatively bureaucratic, slow and inflexible systems; and • A lack of responsive, personalised services for students.40 | Shared services – Case studies 2011